Why is Europe Shifting to Biometric Payment Cards?

Banking CIO Outlook | Thursday, October 17, 2019

Europe is in a mode of anticipation as pilot projects for biometric payment cards pick up pace allowing providers to determine the benefits of the new technology.

FREMONT, CA: Cards are one of the most popular means of payment across Europe. However, the degrading security scenario has rendered conventional cards insufficient from the safety perspective. The use of signatures and pins as a means of authentication is now outdated and, thus, needs to be replaced with more effective methods. Biometric authentication offers one of the most secure ways of verifying the identity of users, and payment card companies are now leveraging the same to build cards with stronger safety against payment frauds or identity information theft. Be is established card companies or startups, the idea of incorporating biometric scanning and matching capability into payment cards has now taken centre stage, and Europe can expect commercial circulation of these cards in less than a year.

The ongoing pilots across European countries have given banks an opportunity to determine the feasibility of the technology at a limited scale. The biometric payment cards contain the biometric details of the users in high definition. Whenever the user makes use of the card for payment, a sensor housed in the card scans the fingerprint and checks if it matches with the originally stored biometric information to authenticate transactions. Thus, there is no requirement to enter pins while making payments. To enable these functions, card manufacturers have incorporated sensors into the cards that are now being trialled extensively.

There are several reasons why Europe is looking forward to the commercial availability of cards. Banking firms will get the opportunity to deliver better services and improve the standard of security. This will help the cause of those financial organisations that have struggled with an increasing number of attacks targeting card transactions, as well as increasing the burden of regulatory compliance. Banks will also be able to make services more convenient for customers since the biometric cards eliminate the need for entering pins. With the induction of Strong Customer Authentication( SCA) under the Revised Payment Services Directive (PSD2), payment service providers are expected to deploy two-factor authentication processes. Biometric payment cards satisfy SCA requirements, as well.

The cost of ensuring transaction security has multiplied so as to mitigate financial frauds. Banks in Europe are expecting that the adoption of biometric payment cards will bring down the costs of offering security. The single-touch biometric cards will help banks fight financial crime in a customer-friendly way. Other advantages that make the biometric card a great prospect include lower transaction time, compatibility with existing payment hardware and software, and support for online payments. Payment card manufacturers have designed the cards to work in the same way for online as well as card-based payments, making the authentication process consistent across platforms. 

While merchants can accept the biometric cards with their existing card machines, customers get to use the biometric cards without any lag or disruption. The self-charging mechanism of the cards eliminates the need for any external batteries and charging requirements, making the cards a convenient commodity.

Built-in fingerprint sensors are on the verge of revolutionising payment cards, and Europe is poised to be one of the earliest adopters. As the trial run results emerge, manufacturers and banking companies will prepare for commercial distribution of the cards. In the process, the currently used cards will be gradually phased out, disabling criminals and enabling a secure payment system in the European region.  

Check out: Top Identity and Access Management Solution Companies in Europe


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